Lead generation is the process of generating, in an audience, interest in a company's brand, products or services using marketing strategies. It is an essential process for both B2B and B2C companies. However, the meaning of Lead Generation goes beyond answering: "What is lead generation?" It is also about understanding why it is a valuable process, as well as what strategies we can use in our companies to attract, nurture and convert leads. That is why in this article we intend to cover each of these topics.
Read on to learn everything you need to know about lead generation.
What is a lead?
If you are linked in one way or another to Marketing or B2B Sales, it is impossible that you have not participated in any conversation in which you talk about leads. But what exactly is a lead?
Leadis a term used in marketing and sales to describe a person or organization that has expressed an interest in a commercial offer, whether it is a product or a service.
Such interest is usually manifested by providing some contact information, such as an email address, a phone number, a social media profile, etc.
What does it mean to be a lead ... from the perspective of a lead? Well, suppose for a moment that you are a lead of a company. In that case, it is likely that you will be contacted by them, because you had some previous interaction: perhaps you registered on their website, or subscribed to their newsletter, or downloaded some content.
Despite the fact that the definition to the previous question "what is a lead?" It may seem simple and direct, there are still some things that we must clarify, one of them is the common misuse of the terms "lead" and "prospect".
Leads vs Prospects: What's the Difference?
As we said before, leads are those people or organizations that provide some contact information and express some type of interest in what you sell. The prospects, on the other hand, are leads that are already potentially about to make a purchase, but have not yet taken the step to start the process.
Despite the fact that marketing and sales professionals define leads and prospects differently, for me there is no doubt that prospects are more advanced in the sales funnel than even the most qualified leads. In fact, a prospect is created when an SDR contacts a lead who is ready to buy.
Types of leads
There are many types of leads and it is very useful to classify them so that you can identify what stage of the process they are in and what has to happen to move them to the next phase.
Some people classify leads in terms of extremes on a temperature scale: hot or cold leads. Another more descriptive classification of leads is based on the different steps in the qualification process: IQL, MQL and SQL.
Information Qualified Lead (IQL)
In the initial stage the leads are IQLs, at that time they still do not know much about our company, and we must focus our efforts towards that objective, providing, for example: access to information about our company, samples, webinars, newsletters, etc.
Marketing Qualified Lead (MQL)
Once we have provided the IQL with information about our company, if they show interest in learning more about any of our products or services, they become MQLs. At that time, they are curious, they are interested in our products, but they are not ready to buy yet. In most cases, they need additional information or assistance from our marketing team to mature their purchasing decision.
Sales Qualified Lead (SQL)
Unlike an MQL, an SQL shows purchase intent. At this stage, the lead can already be considered a prospect and is about to become a customer. The conversion from MQL to SQL is achieved by offering free tests, demos, testimonials from one of our clients, etc.
At this point the marketing team loses control over the lead, since the SQL is already downloaded to the sales team where they treat it as a prospect.
What is Lead Generation?
Getting leads is one of the main objectives of any company. Companies dedicate large amounts of resources to generate leads, but the truth is that if those leads are not ready to buy, it will be difficult to sell.
Lead Generation, in marketing, is the process of attracting leads to your company, educating them and leading them on their way to purchase. It is the beginning of a relationship with someone who has shown an interest in your product or service.
Lead generation is an essential part of the sales funnel in B2B companies. In fact, the products or services of B2B companies are high value, at considerable prices, and it is highly unlikely that web visitors will purchase your product or service directly from the website. The collection of new leads allows these companies to educate and nurture potential customers through email marketing to the point of bringing them to the ready-to-buy situation, at which point, then yes, the sales team is involved to close the sale.
Lead generation is also important for e-commerce and B2C companies, as email and web marketing remain one of the most effective channels for online marketing and, even if customers don't make an immediate purchase, collecting lead's contact information allows to impact them again with messages later.
Differences between Inbound and Outbound Lead Generation
As Lead Generation B2B professionals, our responsibility is to generate the high-quality, ready-to-buy leads needed, necessary to produce a solid return on investment from your marketing programs. That can happen in many ways. Often it is the combination of Inbound and Outbound activities that produces the best results. Developing a strategy to maximize a program effectively requires understanding the difference between Inbound and Outbound Lead Generation.
Inbound Lead Generation
Outbound Lead Generation
To be successful in our generation of B2B leads, the ability to take advantage of Inbound and Outbound techniques is vital. Inbound Lead Generation is necessary to replenish our sales flow with new leads, while Outbound Lead Generation helps us track and drive leads through the sales cycle. Only through the combination of both practices can we build effective Lead Generation engines capable of filling our sales funnels.
Internal or Outsourced Lead Generation?
When it comes to Lead Generation, a question that always hangs with marketing executives is whether to opt for outsourcing or manage those activities internally. Most companies opt for both approaches. There is a lot of evidence and results that support the effectiveness of working with outsourced Lead Generation services. In addition to the cost saving aspect, there are many other factors that influence the decision to outsource lead generation.
If we have little time to reach our sales goals, outsourcing is a more than viable option. It would take too long to select, hire, train, equip additional personnel to generate leads.
Improving the skills of our team is always an option, but it has an additional cost. Also, even after training, we have to deal with the subsequent learning curve. Mastering skills like SEO, Marketing Automation, or making appointments comes from experience. Therefore, before investing in training our team, let's ask ourselves:
- The skills we want to achieve are absolutely necessary in our internal team? Or maybe we could incorporate them through a third party?
- Internal team members will not need more training in skills that complement lead generation? For example, project management?
Technology and Tools
Lead generation depends on having technology to manage the process: CRM, Sales Enablement, Marketing Automation, etc. Technology is a serious investment initially and recurring expense later. On the other hand, outsourcing gives us access to technology that meets industry standards.
Lack of budget
Wages are one of the biggest cost impediments for small and medium-sized businesses. Furthermore, if the lead generation process already involves some additional costs. That is why it is appropriate to compare the costs of the internal and outsourced models to determine which one provides the best ROI.
Lead generation is essential to grow a healthy business. Success in lead generation is, in equal parts, art, science and perseverance: there is an art to generating and nurturing leads, a lot of science that drives lead management through automated tools, and a good dose of perseverance that is necessary throughout the process. Not in vain only 2% of sales are made on the first contact, most sales occur after a long process of education and maturation.
The purchasing processes of today's customers are quite different from those of a generation ago. Buyers today are well informed, they want to feel identified with their brand and they want it to answer their questions and needs, but only when they ask for it. Designing a solid lead generation strategy helps us find leads, separate the "ready to buy" from the "curious" and nurture the qualified to go down the funnel.